In the Drosophila peripheral nervous system (PNS), groups of cells are allowed to acquire a neural fate through their expression of the proneural genes. These genes, the bHLH transcription factors achaete and scute, establish a cell cluster where all cells expressing them may potentially become neuronal. Later, lateral inhibition mediated through the Notch receptor functions to select out one of the cells in the proneural cluster to become neuronal, while the non-selected cells revert to an epithelial fate. We have shown that proneural genes activate genes involved in the process of lateral inhibition, thus tying together an early cell fate determination process with later mechanisms that serve to refine the initial fate choices. However, we do not understand what properties proneural gene expression confers on a cell in the proneural cluster. As a first step towards answering this question, we propose to identify the direct downstream targets of proneural gene activity. We will then characterize these genes with regard to their patterns of expression, and the effect of loss or misexpression of these genes on cell fate determination in the PNS. These studies will allow us to better understand how initially equipotent cells become determined as a specific cell type.